US’ ‘labor’ law another self-hurting blow

When US President Joe Biden signed the “Uyghur Forced Labor Prevention Act” into law in December last year, which bans imports from Xinjiang on the pretext of protecting human rights, the Chinese government condemned it as it being based on lies told by anti-China forces.

It also warned of the serious consequences that the law will have beyond bilateral relations, such as disrupting the international trade order and undermining the global industry and supply chains.

Now less than two months into the law taking effect on June 21, the US solar industry is already feeling the pinch of supply disruptions as Chinese solar-panel suppliers have had shipments to the United States detained or sent back during the past several weeks, according to a recent report from The Wall Street Journal.

The law assumes all goods from Xinjiang are made with forced labor and so can’t be imported unless suppliers can prove otherwise. “The level of documentation required by authorities so far has caught many in the industry off guard,” the report said.

The impact of the “forced labor” law on the development of US solar energy projects is obvious, given the fact that up to 45 percent of polysilicon used in solar panels comes from Xinjiang. In a worstcase scenario, US customers could see 10 gigawatts or more of supplies delayed, equivalent to nearly half of the US’ installed capacity last year, the WSJ report said, quoting an industrial analyst. This adds to the woes the country’s solar energy sector is already experiencing as a result of rising materials costs, and risks putting in jeopardy Biden’s ambitious green energy goal of building a carbon-free power grid by 2035.

The labor rights of the people of all ethnic groups in Xinjiang are well protected, and the US law and related bans on products from there under the guise of human rights are nothing but an act of economic coercion aimed at decoupling China from the rest of the world.

But since the world’s two largest economies have become highly interdependent economically over the past four decades, confrontation will only damage the interests of consumers and companies in both China and the US. Hopefully, those in the US who continue to seek to make Xinjiang an issue to contain China will realize their folly at an early date so that the two countries can return to the path of cooperation. This would be a tonic for the global economy which is still struggling to recover from the effects of the COVID-19 pandemic.